Wal-Mart to stop extra $1 Sunday pay for employees
Bentonville, Arkansas, United States (AHN) – Wal-Mart Stores announced Wednesday that it will no longer pay its employees who work Sundays an additional $1 an hour. The new policy, however, would only cover workers hired after Jan. 1, 2011.
Current U.S. employees numbering 1.4 million will not be affected by the new policy, a Wal-Mart spokesman said.
The policy will also not apply to workers in Wal-Mart’s 49 Massachusetts and 10 Rhode Island outlets because the employees in the two states were not extended the extra $1 Sunday pay since their hourly rate for Sunday work is 1.5 times based on state labor regulations.
The policy is part of Chief Executive Officer Mike Duke’s strategy to reduce cost after Wal-Mart registered six consecutive quarters of sales declines at its U.S. operations.
On top of lower sales, operating expenses went up in 2009 to about $80 billion partly due to health benefits extended to workers.
To offset revenue reduction in its U.S. operations, Wal-Mart offered in November $2.4 billion to acquire a majority share in Massmart, a South African retail chain.
Wal-Mart is expanding its international business, particularly in emerging markets with high growth potentials.
Wal-Mart got the unanimous vote of the Massmart board, but needs the approval also of the South African regulators and 75 percent of Massmart stockholders.
The South African Commercial, Catering and Allied Workers Union expressed concern with the possible Wal-Mart buy-in because of the U.S. retail giant’s stand against unions.
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